The Farm CPA
Paul is now part of the fourth generation in America that is involved in farming and hopes the next generation will be involved also. Through his blog he provides analysis and insight to farmer tax questions.
Wall Street Press Pays Attention to Ag Commodities
Sep 23, 2010
When farm commodity prices are increasing, the coverage of Ag tends increase by the Wall Street press. In today's Wall Street Journal, there were two articles related to Ag commodities.
In the Ahead of the Tape article, there was a discussion on how the price of cotton going over $1 per pound for only the second time since the Civil War will affect apparel retailers. The article mentioned that for every penny increase in cotton prices, Hanesbrands, Inc. would have their raw material costs go up by $3 million. Now, the interesting thing to me, is when cotton is at 50 cents a pound, you would never see the Wall Street Journal having a front section article on how a 1 penny decrease would save $3 million.
On page 2 of the Money and Investing Section was a featured article on how a timely rain in Russia is helping Black Earth Farming Ltd. get their entire 44,000 acres of winter wheat planted in Russia. The gist of the article is that rains have come to Russia to save the crop, however, when you read the article in detail, there are still many sections of Russia that have not gotten any or much rain and their winter wheat crop will only cover 15 million hectares (about 37 million acres) at best.
When prices are low, you almost never see any articles on Ag commodities in the Wall Street Journal, however, when prices are high, you tend to see lots of them. I am hoping to see a lot more.
Please note that the Wall Street Journal site is a paid subscription site, so you may not have full access to the article without being a subscriber.